Bullish indicating open at $55-$60, IPO prices at $37
On Thursday, Needham analysts revised the price target for PVH Corp (NYSE: NYSE:PVH) stock to $100 from $115, maintaining a Buy rating. This adjustment comes in response to PVH shares experiencing a significant decline of 18% in a stable market environment. The drop follows a first-quarter performance that fell short of expectations and a notable reduction in the fiscal year 2025 guidance, attributed to factors beyond tariffs. According to InvestingPro data, the stock has declined over 25% in the past six months, despite maintaining impressive gross profit margins of nearly 59%.
The analysts highlighted the market’s disappointment, particularly concerning the company’s margins. Despite the current challenges, PVH stock is trading at a low multiple of 6 times the fiscal year 2025 earnings per share guidance and 5 times the fiscal year 2026 estimate. This valuation suggests potential for positive medium-term risk and reward. InvestingPro analysis reveals several positive indicators, including a strong financial health score and consistent dividend payments for 55 consecutive years. Subscribers can access 8 additional exclusive ProTips about PVH’s financial outlook.
Needham analysts also adjusted their earnings per share forecasts for PVH, lowering them to $10.92 for fiscal year 2025 and $12.76 for fiscal year 2026, down from previous estimates of $12.53 and $14.30, respectively. The new price target reflects a modest 8 times price-to-earnings ratio based on the fiscal year 2026 estimate.
Despite the current downturn, Needham analysts believe the extent of the stock’s decline may be excessive. They noted that PVH management faces significant challenges in rebuilding investor confidence in the stock, which has been under pressure.
The revised price target and earnings forecasts underscore the need for PVH to address investor concerns and improve sentiment in the market.
In other recent news, PVH Corp, the parent company of Calvin Klein and Tommy Hilfiger, reported first-quarter 2025 earnings that exceeded analyst expectations. The company posted earnings per share of $2.30, surpassing the forecasted $2.23, while revenue reached $1.98 billion, above the anticipated $1.93 billion. Despite these positive financial results, PVH’s stock saw a significant decline in after-hours trading. The company announced new leadership for Calvin Klein and is implementing cost-saving initiatives in response to the challenging retail environment. Analysts have been closely monitoring PVH’s performance, noting that the company has faced macroeconomic pressures and a decline in direct-to-consumer sales. PVH’s direct-to-consumer revenue fell by 3%, although wholesale revenue increased by 7% in constant currency. The company has also returned over $550 million to shareholders through stock repurchases. PVH has provided a cautious outlook for the year, projecting flat to slightly increased revenue, with expectations of achieving double-digit operating margins by the end of 2025.
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